Saudi Arabia makes big steps to improve real estate transparency

Saudi Arabia has moved up the rankings to finish in the ‘Semi-Transparent’ category for the first time in the JLL and LaSalle Investment Management’s 2016 Global Real Estate Transparency Index (GRETI).

Strong advances over the past two years have seen Saudi Arabia (63rd) and Egypt (65th) move into the ‘Semi-Transparent’ group, which is largely dominated by large emerging markets, including the BRIC countries (Brazil, Russia, India and China).

Dubai (48th) has retained its position as the most transparent real estate market in the Middle East and North Africa (MENA) region, with Abu Dhabi (59th) following closely behind, according to the report.

Dubai improved by a respectable 23 points to be among the top 25 global improvers.

“This is very good news for Saudi Arabia,” said Jamil Ghaznawi, country head of JLL Saudi Arabia.

“Moving into this category for the first time shows the advances the kingdom is making and is an indication of the focus the country has on strengthening corporate governance, transparency and market data.”

Elsewhere in the Gulf, Bahrain was ranked 67th, Kuwait 73rd, Qatar 74th and Oman 89th out of 109 markets analysed.

These included the UK, Australia, Canada, the US, France, New Zealand, the Netherlands, Ireland, Germany and Finland.

The report said there is a growing recognition that transparent real estate practices play a significant role in capital formation, municipal finance, and as a foundation to improve the quality of life in many communities.

In Saudi Arabia, the formation of real estate committees in the kingdom’s Chambers of Commerce has highlighted the issue of low transparency in the market and encouraged more action towards addressing the issue.

As a result, there has been some mild improvement in ‘open data’ platforms such as registering property transactions with the Ministry of Justice which is then shared publicly on its website, the report said.

“Saudi Arabia is now positioned in a very dynamic tier, which is considered the most improved transparency group, and a category which is seeing growing middle classes mobilising against corrupt practices,” added Ghaznawi.